RBI Deputy Governor Shirish Chandra Murmu recently addressed the Global Cash Management 2026 conference in Jakarta. He spoke to central bankers about a unique situation in India called the "cash paradox." Even though digital payments like UPI are booming, the total amount of cash in the economy is still growing at double-digit rates. This shows that while people use apps for small daily buys, they still hold onto physical money for other needs.

Murmu explained that cash is still the king for specific groups in India. This includes people living in rural and semi-urban areas, low-income households, and senior citizens. Small businesses also rely heavily on cash for their daily operations. For these groups, physical money provides a sense of security and ease that digital tools have not yet fully replaced.

The scale of India’s cash system is massive. The Deputy Governor revealed that there are currently about 176 billion banknotes in circulation (total cash moving in the economy). To keep the system running, the RBI produces 28 to 30 billion new notes every year. At the same time, they withdraw about 21 billion soiled notes (dirty or damaged money) annually to ensure only good quality bills remain in the hands of the public.

A major focus for the RBI is the Clean Note Policy. This policy ensures that the central bank regularly removes unfit currency and replaces it with fresh notes. Murmu emphasized that maintaining public confidence in the currency is a core duty. If people trust the quality and security of the notes, the entire financial system stays stable.

India has also become very self-reliant in making its own money. Most of the banknote paper mills, printing presses, and ink production units are now controlled by the RBI and the Government of India. This reduces dependence on foreign countries for printing our national currency. It also helps in keeping the production process secure and cost-effective.

However, managing cash in a digital age brings new challenges. The RBI finds it difficult to forecast exactly how much currency the public will need as digital habits change. They are also looking into making notes last longer, possibly using technologies like polymer notes (plastic-based money). Another goal is to reduce the environmental footprint (pollution and waste) created during the printing and transport of cash.

For bank officers in India, this news means that cash management will remain a big part of branch work. While you push customers toward digital banking, the logistics of handling physical deposits and withdrawals will not go away soon. Secure logistics and efficient distribution are still top priorities for the central bank.

Looking ahead, the RBI will continue to balance the growth of digital payments with a robust cash system. The goal is not to kill cash, but to ensure it exists safely alongside digital wallets. Bankers should expect continued focus on the Clean Note Policy and new tech updates in how currency is managed at the chest level.